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CPG Giant Unilever Gets a Handle on Demand

Supply Chain Brain

August 2, 2011

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Unilever supplies retailers around the world both large and small, and getting an accurate picture of consumer demand at all points of sale can be a daunting task. In 2006, the company began a U.S. pilot of demand-sensing software from Terra Technology. Early results were positive, although wider adoption had to wait for another two years because of more immediate corporate priorities.

It wasn’t until August 2009 that Unilever went fully live with Terra’s demand-sensing application for retail products in the U.S. The benefits of the technology were quickly evident, according to Priya Notani, Unilever's global project manager for demand-sensing and multi-enterprise inventory optimization. In the first year of using the tool the company saw a 40-percent reduction in forecast error within a seven-day planning horizon. At the same time, it was able to reduce inventories. In addition, by having the right item in the right place at the right time, Unilever could lessen its dependence on expedited shipments and transfers between distribution centers.

Unilever is assigning a high priority to collaborating across the “end-to-end” supply chain. Access to POS data will result in an even better demand signal and more accurate forecasts. The company’s priority is ensuring a successful implementation of Terra’s demand-sensing and inventory optimization modules on a global scale.